1997 (11) TMI 285 - AT - Central Excise

Summary

Issues:
1. Interpretation of relief under Notification 198/76 for production in excess of base period clearances.

Analysis:
The appeal before the Appellate Tribunal CEGAT, New Delhi involved the interpretation of the relief available under Notification 198/76 concerning production exceeding base period clearances. The main issue was whether the effective duty should be calculated before or after applying the benefit of proforma credit. The appellant, a manufacturer of cold rolled strips from hot rolled strips, was entitled to relief under Notification 198/76 to the extent of 25% of the effective duty for goods produced above the base period clearance. The appellant availed the benefit of proforma credit under Rule 56A for duty paid on materials used. The dispute arose when the Superintendent of Central Excise alleged that the appellant's method of duty calculation was incorrect, leading to a show cause notice for duty recovery. The Additional Collector confirmed the duty demand, prompting the appeal. The appellant argued against the extended time limit for duty recovery, citing the absence of suppression, misstatement, or fraud in their duty calculation method, supported by legal precedents. The Tribunal considered the submissions and found that the show cause notice did not allege suppression or misstatement by the appellant, thus accepting the plea of limitation and setting aside the impugned order, thereby allowing the appeal.

Judgment:
The Appellate Tribunal CEGAT, New Delhi, comprising Shri K. Sankararaman and S.L. Peeran, JJ., allowed the miscellaneous application for a change of the appellant's name supported by a court order. The Registry was directed to update the appellant's name in the records. The Tribunal deliberated on the issue of duty calculation under Notification 198/76 for production exceeding base period clearances. The appellant's duty calculation method, which deducted 25% relief under the notification before applying proforma credit, was challenged by the Central Excise department. The Tribunal noted that the show cause notice did not allege suppression or fraud by the appellant, leading to a finding in favor of the appellant on the plea of limitation. As a result, the impugned duty recovery order was set aside, and the appeal was allowed. The judgment emphasized the importance of allegations of suppression or misstatement for the applicability of extended time limits for duty recovery.